What is a default judgment?
When a court claim for money is issued, the defendant has a specified period of time to file an Acknowledgement of Service or a defence. That is generally 14 days from the date the claim was received (or ‘served’) under the court rules. A defendant can file a defence within that period or file an Acknowledgment of Service confirming they intend to defend the claim, giving them a total of 28 days from the date of service to file a defence.
How can you obtain one and how (and when) can it be set aside?
A default judgment can be obtained from the court when the defendant has not filed an Acknowledgement of Service and/or defence within the specified time. It is awarded without any consideration of the merits of the claim for purely procedural reasons – the defendant has simply failed to deal with the claim in time.
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It will usually be a judgment for the whole of the claim plus the court issue fee, and will be enforceable in the same way as a judgment obtained after a contested trial. It will show up on a credit record as a CCJ and may affect the ability of the defendant (whether an individual or a business) to obtain credit
Nearly 90% of claims for money in the County Court end with a default judgment. This is usually because the defendant does not have a defence to debt and has simply chosen to ignore the claim.
However, sometimes a default judgment is obtained because court papers were not received, or the defendant wished to defend the claim but did not understand the procedure.
What can I do if a default judgment has been obtained against me?
You can apply to the court to set aside a default judgment. You will need to show the court two things: firstly, that you acted quickly when you became aware of the judgment, and secondly, that you either have a realistic prospect of successfully defending the claim or that there is some other good reason why it should proceed to trial.
Generally, you will want to show you have a potential defence to the claim. The court will not decide the case, so you will not need to prove that you will defend it, just that it is a possibility.
If you delay in dealing with a default judgment for too long, the court may refuse to set it aside even if you have a potential defence. It is therefore essential to act quickly.
On many occasions when I have been instructed by a defendant who has a default judgement against them, I have been able to persuade the claimant to agree to set it aside rather than contest an application, keeping costs to a minimum.
Our team of dispute resolution solicitors will be able to help you in relation to default judgments and applications to set them aside. We will give you realistic legal and commercial advice and help you find the best strategy for you.